Money buys happiness

5:00 AM PDT 10/3/2008
by
Carl DiOrio
,
AP

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Hollywood movies seem to get ever more expensive to produce, but there is a silver lining: The priciest films tend to be the most profitable.

That's the finding of a new SNL Kagan study, which also found that animated films have the best average profitability among all genres. Animated films contributed an average net profit of $230.6 million under a major studio deal, Kagan found.

The researcher analyzed all films released in 1,000 or more locations from 2003-07, and the two priciest segments surveyed showed the best profitability.

Nine films in the $90 million-$100 million range posted an average net profit of $374.7 million, and 80 films costing more than $100 million to produce showed average profitability of $282.3 million.

The researcher did note at least one exception to the costlier-is-better premise.

Horror films had the best results when produced for $10 million or less, with an average net profit of $40.3 million. That compared with a profitability of $21.9 million for horror flicks in general.

Horror was the second-least-profitable films genre; thrillers were at the bottom of the pack with an average profitability of $18,553.

The 741 films analyzed in the study averaged $66.4 million in net profit, Kagan said.

The researcher claimed the findings also show the economic resiliency of motion pictures.

"When the going gets tough, consumers go to the movies," Kagan analyst Derek Baine said. "Historically, theaters have been fairly recession-proof, and this year looks to be no exception." (partialdiff)